Twitter Inc has a chronic problem with its stagnating user growth, and investors are concerned that the firm has never turned a profit. Twitter might be able to get itself back into the good graces of Wall Street if it could find a way to monetize its current user base; as usual, the firm doesn’t know how to make money from its users. Twitter might have a cash cow in its Periscope app but it remains to be seen if the company will mine the full potentials of the app.
DigiDay reports that ad agencies and brands are in love with Periscope because it allows them to interact and keep their audiences engaged in real time. Twitter launched Periscope about 8 months ago and the app has reached decent milestones in its short life. In August, Periscope reached its 10M user base milestone in four months. The success of Twitter’s Periscope has also forced Facebook to enter the live-streaming space with its Live feature.
Twitter is Underselling Periscope
Brands are in love with Periscope but it appears that Twitter Inc is unaware of this fact – if Twitter is aware, it seems the firm doesn’t know how to convert the love into cash. Zach Gallagher, evp, director of digital strategy at Deutsch provides an insight into the love for Periscope in saying “Being there live for something that wasn’t planned is real social currency” after the app was used for a live “Press Conference” for Taco Bell.
He sees the potential in the app and he says, “the possibility of a show going off the rails is compelling”. Yet, Twitter has largely refused to promote Periscope to brands. Gallagher says the app is packaged like an afterthought in Twitter’s offerings. He says, “Our crew has been seeing it sort of tacked on at the end of Twitter decks, and even when it seems like a perfect fit for an idea, no one is really pushing it on us… We have to ask for it”.
$17B Opportunity for Twitter
Twitter Inc has been sliding down the slope of hope as revenue and user growth continue to be major headwinds for its share price. However, analysts have opined that the firm might have a $17B opportunity in Periscope if it makes the right moves. Analysts at Jefferies confirmed the bright outlook for Periscope by saying, “We believe [Twitter] is a leader in the crowded social media space and is particularly well-positioned to benefit from online video ad and mobile tailwinds”.
Experts believe that the online video ads market should be worth $17B per year by 2017 and they believe that Periscope might give a Twitter a strong foothold in that space because of its live nature. However, it remains to be seen if Twitter will seize the day by making a bold push to sell the app to brands.